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A Share Security Agreement is commonly used in Hong Kong financing transactions where shares are provided as collateral for loans or other financial obligations. This document is essential in both bilateral and syndicated lending arrangements, creating a security interest over shares that can be enforced if the underlying secured obligations are not met. The agreement must comply with Hong Kong legal requirements, including registration under the Companies Ordinance and satisfaction of perfection requirements. It typically includes detailed provisions regarding the maintenance of the security, voting rights, dividends, and enforcement mechanisms. The document is particularly important in acquisition financing, corporate restructuring, and general secured lending transactions where share security is a key component of the collateral package.

1. Parties: Identifies the security provider (chargor), the security holder (chargee), and the company whose shares are being charged

2. Background: Sets out the context of the security arrangement, including reference to any underlying facility or loan agreement

3. Definitions and Interpretation: Defines key terms and establishes interpretation principles for the agreement

4. Creation of Security: Establishes the fixed charge over the shares and any related rights

5. Representations and Warranties: Security provider's confirmations regarding ownership, authority, and capacity

6. Covenants: Ongoing obligations of the security provider regarding the charged shares

7. Further Assurance: Obligation to execute additional documents and take necessary steps to perfect security

8. Powers and Rights of the Security Holder: Details the rights of the security holder in relation to the charged shares

9. Enforcement: Circumstances and methods of enforcing the security interest

10. Application of Proceeds: Order of distribution of any proceeds from enforcement

11. Release of Security: Conditions and process for releasing the security

12. Notices: Communication requirements and contact details

13. Assignment and Transfer: Rights and restrictions regarding transfer of rights under the agreement

14. General Provisions: Standard boilerplate clauses including governing law and jurisdiction